Shell and BG Group’s shareholders are expected to vote on the merger of the two companies on January 27 and 28, respectfully. After shareholders approve the deal on these dates, the transaction could be completed in mid-February. This is because the delisting of an acquired company’s shares ordinarily takes about 10 business days following shareholder approval.
The combination of the two companies will create the world’s largest LNG trader. It’s the largest deal in the O&G sector since Exxon bought Mobil in 1998, and has been dubbed “the deal of the decade.” Current market valuations place the value of the deal at about $53 billion. When the takeover was announced in April, the deal was worth $70 billion.
Shell said that a key rationale for pursuing the deal was the acceleration of its growth strategy in global LNG and deepwater. Van Beurden said during the April 8 conference call announcing the deal, “LNG is a very important component of this…The whole idea is that we turn the company on the back of this deal into a much more focused company, very, very strong in gas and very, very strong in deep water.”
Shareholder approval remains the final step before the merger is final.
On Monday, BG Group asked Britain’s High Court for approval to convene the shareholder meetings and publish its scheme document. The court is expected to give approval Tuesday. BG Group’s scheme document and the Shell shareholder prospectus will then be published on December 22.